“The circular economy is not an entirely new concept, but it is presently at a major inflection point. Its intellectual roots emerged from early ideas and practices of recycling and pollution prevention, life cycle analysis, eco-efficiency assessments and analysis of materials flows. In response to current sustainability challenges and business opportunities circular economy proponents are now attempting to transition it from a diverse set of individual methodologies aimed at addressing specific problems to a more integrated and systematic set of ideas to transform business strategies and operations.”

Government policy, non-governmental organization (NGO) evaluations and advocacy, and university research each perform important roles in this transition. However, the primary focus and responsibility for circular economy implementation lies in the management and strategic alignment of value chains across individual business sectors as this will be the area of greater impact and market scale.

There are major structural challenges to advancing circular economy thinking and applications. While there remain many knowledge gaps in operationalizing circular economy opportunities, they alone are not a principal obstacle to success. Among the more important are:

  • Underpriced commodities that generate overconsumption of materials and natural resources
  • Absence of circular economy planning in product design and development.
  • Complicated logistics management that stems from insufficient collaboration among suppliers, product producers, and customers.
  • Lack of robust markets for commercializing used products and reducing their costs through scale.
  • Insufficient engagement from consumers in connecting their purchasing behavior to more sustainable beliefs and lifestyles.

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